Civil conflict in petroleum producing regions

Does oil and gas production cause the outbreak of civil violence? And if so, under what conditions is oil and gas extraction particularly risky? Existing research suggests that petroleum‐producing states are more likely to witness the outbreak of intrastate conflict than other countries. However, it is unclear whether this relationship represents a causal effect or reflects the fact that the location and intensity of petroleum production is endogenous to political violence. Moreover, current research is unable to identify those areas where petroleum production is most likely to trigger civil conflict. This thesis addresses these gaps in an integrated fashion. The issue of endogeneity is tackled by relying on an instrumental variable design that employs data on the geological determinants of petroleum deposits to predict the occurrence of petroleum production. Further, a collection of newly available spatially disaggregated data is employed to identify the local demographic and political conditions under which the conflict‐inducing effect of petroleum production is greatest. The empirical analyses yield strong evidence for a local, causal effect of petroleum production on violent separatist conflict. Moreover, the results show that petroleum production is most likely to trigger separatist violence if it takes place in the settlement areas of local ethnic communities that lack representation in the central government and are weakly penetrated by state institutions.

@phdthesis{civil-conflict-in-petroleum-producing-regions,
title = {Civil conflict in petroleum producing regions},
author = {Hunziker, Philipp},
school = {ETH Zurich},
type = {{PhD} dissertation},
doi = {10.3929/ethz-a-010433796},
url = {http://e-collection.library.ethz.ch/view/eth:47718},
year = {2015},
abstract = {Does oil and gas production cause the outbreak of civil violence? And if so, under what conditions is oil and gas extraction particularly risky? Existing research suggests that petroleum-producing states are more likely to witness the outbreak of intrastate conflict than other countries. However, it is unclear whether this relationship represents a causal effect or reflects the fact that the location and intensity of petroleum production is endogenous to political violence. Moreover, current research is unable to identify those areas where petroleum production is most likely to trigger civil conflict. This thesis addresses these gaps in an integrated fashion. The issue of endogeneity is tackled by relying on an instrumental variable design that employs data on the geological determinants of petroleum deposits to predict the occurrence of petroleum production. Further, a collection of newly available spatially disaggregated data is employed to identify the local demographic and political conditions under which the conflict-inducing effect of petroleum production is greatest. The empirical analyses yield strong evidence for a local, causal effect of petroleum production on violent separatist conflict. Moreover, the results show that petroleum production is most likely to trigger separatist violence if it takes place in the settlement areas of local ethnic communities that lack representation in the central government and are weakly penetrated by state institutions.}
}